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CCS concluded that notwithstanding the high
combined market share of the Parties in Singapore,
the Proposed Transaction is unlikely to substantially
lessen competition in any market.
There are
no significant barriers
to entry that may hinder or prevent
existing global CR manufacturers and
distributors from expanding or entering
themarket for supplyingCR toSingapore.
Existing global CR manufacturers can
easily expand production, and potential
competitors who are not currently active
in supplying CR to Singapore are able
to supply into Singapore should there
be demand for their CR. This is mainly
due to excess capacity in global CR
production. Furthermore, ease of
entry is facilitated by distributors who
can aggregate demand; and entry
for several potential competitors is
also aided by the presence of their
subsidiaries or sales offices currently
located in Singapore.
There is considerable
countervailing
buyer power
. Customers are able to (and
do) switch between various suppliers
of CR. Moreover, some Singapore
customers are part of multinational
groups which have the option of buying
CR at prices negotiated on a global basis.
Coordinated effects are unlikely to be a
concern due to
low barriers to entry
by
potential suppliers aswell as the difficulty
in monitoring prices and compliance
with any common understanding among
existing CR suppliers.
Singapore’s
demand for CR is small
in relation to the
significant excess capacity in global CR production. The
ability of the merged firm to act unilaterally (e.g. to raise
prices) is constrained as other global CR manufacturers
with spare capacity can meet such demand.
In clearing the Proposed Transaction, CCS found that:
It was concluded that the Proposed Transaction is unlikely to substantially lessen
competition in any market in Singapore, and therefore will not infringe the Act. The
Parties overlap in the supply of CRworldwide, including toSingapore. DenkaPerformance
Elastomer LLC is currently owned by Denka (70%) and Mitsui (30%). CCS issued its
clearance decision for the Proposed Transaction to the Parties on 7 May 2015.
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CCS ANNUAL REPORT 2015-2016
GUIDING YOU TO NEW HEIGHTS